U.Today - The U.S. may trigger a surge in institutional adoption of Bitcoin (BTC) as different states are making advancements in legislation regarding the digital asset. Notably, 20 states have put forward legislative proposals to establish Bitcoin reserves for their respective governments.
Legislative momentum gaining traction for Bitcoin reserve
Matthew Sigel, Head of Digital Assets Research at VanEck, highlighted that the impact would be major if all the legislative bills fly through and are enacted as law.Notably, such adoption would see approximately 247,000 BTC in purchases by these states. The estimated value of such purchases is currently pegged at $23 billion.
These bills are at different stages of legislative consideration in the respective states. Some have just been introduced in state Congresses, while others have passed the first reading and are currently before committees for consideration.
While the majority are before the first committee, only Utah has progressed to the second committee for due consideration.
Meanwhile, most states are considering committing 10% of their funds to purchase Bitcoin. North Carolina and New Mexico lead with $2,629,104,600 and $2,104,900,000, respectively, as estimated potential investments. This would translate to 27,118 BTC and 21,711 BTC.
Potential market impact
According to Sigel, these proposed purchases do not include possible Bitcoin allocations from pension funds, which can drive up demand.Notably, funding sources vary across different states. New Mexico, for instance, hopes to leverage capital from land grant permanent funds, Tobacco Settlement Permanent Fund and other funds deemed appropriate by the investment council.
If state legislators nod to these proposals, the Bitcoin reserve initiative will commence. That would translate to additional capital flow and could influence an upward trajectory for Bitcoin.
Bitcoin traders will keep a keen watch on developments in the various states and how these actions will impact the price of Bitcoin.